Entrepreneurial orientation, global mindset and internationalization of

Chinese SMEs

Xuebing Cao and Zhibin Lin1

(word count: 10,183)

Abstract: This paper examines the role of entrepreneurial orientation, global mindset on

two international activities: networking and know-how, and subsequently on the firms’

degree of internationalization. A conceptual model was developed and tested with a

sample of 208 small and medium size firms from China. The results indicate both

entrepreneurial orientation and global mindset have positive effects on international

networking and know-how activities, though they do not have a direct effect on the

degree of internationalization. The effects were indirectly mediated by the firm’s

international know-how activities but not networking activities. The findings shed light

on the factors influencing Chinese SMEs’ internationalization process.

Keywords: Internationalization; entrepreneurial orientation; global mindset;

international activity; Chinese SMEs

1 Xuebing Cao, Keele Management School, Keele University, Staffordshire, UKZhibin Lin, Newcastle Business School, Northumbria University, Newcastle-upon-Tyne, UKCorresponding author: Xuebing Cao, Email: x.cao@keele.ac.uk

1

Introduction

The rapid development of China’s small and medium-sized enterprises (SMEs) is one of the

major drivers of the impressive growth of the country’s economy in recen decades. In China,

SMEs provide 60 per cent of GDP, 75 per cent of industiral value-added output and more

than 50 per cent of urban employment (Zhang and Xia 2014). SMEs are also a significant

international force as they contribute to 68 per cent of the country’s export (Hall 2007), as

entrepreneurial firms are a key driving force behind China’s rapdi eocnomic transformation

(Yang and Li 2008). Yet most studies on Chinese firm’s internationalization have primarily

concentrated on large-scale state-owned enterprieses (SOEs) (Cardoza and Fornes 2011,

Wang and Ngoasong 2012), with insufficient research evaluating the global exapansion and

entrepreneurial oreientation of Chinese SMEs (Tang and Hull 2012).

Recently there has been a growing recognition of the significance of Chinese SMEs’

entrepreneurial orientation and international activities (Tang 2011, Zhang, Ma, and Wang

2012, Zhang et al. 2016). This echoes the overall developent of SME interantionalization

research that remains one of the most improtant areas for in the field of entrepreneurship due

to SMEs’ major contribution to global economic growth and change (Ruzzier, Hisrich, and

Antoncic 2006). By investigating the importance of entrepreneurial orientation and social

capital, studies have also investigated the degree of external social network relationship in

supporting SMEs’ global expansion (Tang 2011, Zhang et al. 2012). The globalization of

2

specialized wholesale market and its impact on facilitatting the interantionalization of labour-

intensive SMEs has been documented (Wang and Ngoasong 2012). In addition, attention has

been paid to identify the associations between different firm ownerships, export tendency,

intenrational entreprreneurship and SME interantionalization (Alon et al. 2013, Cardoza and

Fornes 2011).

Despite the valuable insights offered from these scant studies, little is known about

how SMEs’ entrepreneurial orientation and owners/managers’ personal global mindset jointly

influence the internationalization of Chinese SMEs. Ovearll this gap suffers from three major

issues. First, the lack of in-depth, academic examintion of this important issue is incompatible

with the vibrant reality that more and more Chinese SMEs are internationally directed and

entrepreneurially active. Entrepreneurial orientation is a firm’s strategic decision-making

process that can lead to innovative decisions and actions on new market entry (Lumpkin and

Dess 1996), invovling innovativenss, risk taking and proactiveness that help firms to discover

and exploirt business opportutnities (Etemad 2015, Martin and Javalgi 2016). Global mindset

refers to individuals’ competence and mentality on intenrational option that can handle the

cognitive compelxity combined with a certain holistic veiw of the world, characterized by

opeeness and collabraotion with multiple cultures and realities (Levy et al. 2007). While

entrepreneurs’ global mindset in Western SMEs has been found closely associtaed with

firms’ international orientation, financial results and business growth in global market

3

(Felício, Caldeirinha, and Ribeiro-Navarrete 2015), limited attention has been devoted to

demonstrate the dynamical interlinks between entrepreneurial orientation, global mindset and

the internationalization of Chinese SMEs.

Second, the gap is more noticeable when comparing with the Chinese government’s

viguous advocacy towards entrepreneurship in light of a strong expansion of the private

sector (Su, Zhai, and Landström 2015). In contrast to this negleted attention to the ownership

effect on Chinese SMEs’ international behaivours, many studies have focused on larger state

owned enterprises (SOEs) (Zhang et al. 2016). Third, the extant deficiency in scholarly input

in this area lags behind the abundant contributions towards SMEs’ internationalizatoin and

entrepreneurship research in Europe and USA (Ribau, Moreira, and Raposo 2016). In the

field of international business studies, entrepreneurial orientation, internationalization of

SMEs and global mindset have been given a lot of attentions in recent years. But it remains

less clear how the internationalizaiton of Chinese SMEs is associated with the global mindset

of entrepreneurs, and how this is influenced by individual entrepreneurs’ management

knowledge and social networking activities.

This study aims to address the research void and contribute to the knowledge in this

important field of understanding Chinese SMEs’ international expansion and entrepreneurial

behaviour. It also responds to the high demand of researching SME internationalization due

to the fragmented knowledge about it (Ribau et al. 2016). Grounded in the resourced-based

4

thoery (Barney 2001), the study develops several hypotheses on entrepreneurial orientation,

global mindet and internationalization of Chinese SMEs that may respond to the competitive

international environment very differently comparied with their Western counterparts (Tang

and Hull 2012). Following the call for furthering the conceptural framework of

entrepreneurship (Shane and Venkataraman 2000), this study has two main objectives, the

first of which is to idnetify the effect of entrepreneurial orientation and global mindset on the

degree of internationalization of Chinese SMEs. The second objective is to evaluate the

mediating role of Chinese SMEs’ internationalization activities, including international

networking and know-how activities, on the relationships between entrepreneurial

orientation, global mindset and internationalization of Chinese SMEs.

The present study on Chinese SMEs extends the resource-based entreprenuership

paradigm, which states that individuals’ entrepreneurial singits into the value of resoruces can

generate market opertunities (Alvarez and Busenitz 2001, Lumpkin and Dess 1996). It

advances our understanding of Chinese SMEs’ entrepreneurial process by: (i) conceptualizing

the the role of entrepreneurship in Chinese SMEs during their internationalization process;

(ii) offering empirical underpins over SME leaders’ global mindset and its functions in

identifying market opportunities and providing innovative opportunities in the global

marketplace; and (iii) theorizing the mediating effect of entrepreneurs’ know-how and

networking activities on Chinese SMEs’ international process.

5

The remaining of the paper is structured into five parts. First it will review the

existing literature on SMEs’ international behaviours that are related to entrepreneurship and

global mindset, especially those of Chinese SMEs. Second, it will discuss hypotheses of the

study developed from the theoretical background. Then the paper will introduce research

methods, before the next part discusses results and findings. The last part will summarize the

overall conclusion, the implication and contirbution of the research, as well as the future

direction of the study.

SME internationalization and entrepreneurship

Resource-based view

As a major approach to business strategy and international entreprenuership, the resource-

based view has been used extensively to examine firms’ behavours in both domestic and

gobal markets. According to this perspective, firms’ resources and capabilities, including

management skills, organizaitonal processes and routines, and information and knowledge,

are the basis for sustained value-creating competitive advantage (Barney 2001). This

approach is grounded on an assumption that firms’ competitive advantage can be derived

from the intangible koneldge-based resources that are unique costley-to-copy attributes

6

(Ruzzier et al. 2006). It is adapted to analyze entreprenuership (Kellermanns et al. 2016),

which includes cognition, discovery, pursuing market opportunities, and coordinating

knoweldge that can lead to various outcomes (Alvarez and Busenitz 2001).

The resource-based view also helps to examine SMEs’ international entrepreneurship

because these firms need to overcome the difficulty of inadequate finance and human

resources when they go to the global market. In the pursuit of growth in an international

environment, SMEs may encounter unique challenges such as using limited resources

available to deal with an increasingly competitive overseas environment, newness or

foreignness in an unfamiliar and competitive international market, and signficant intern-

market differences that do not match SMEs’ existing operation strategies (Lu and Beamish

2001, Ruzzier, Antoncic, and Hisrich 2007). Such situation is in conjunction with the

globalization impact, and is more so for domestic and new SMEs than those of already highly

internationalized sector (Ruzzier et al. 2007). The degree of entrepreneurs’s expertise and

cognitive provesses can also strongly influence SMEs’ international expansion as they can

better identify and evlauate global opportunities on provudcts and services (Wright,

Westhead, and Ucbasaran 2007). A further development of the resource-based view is the

multi-dimentional model, which integrates the stage theory, resource-based view and network

theory, and provides new conceptualization of firms’ internationalization by examining

firms’ operation, product and performance dimensions (Ruzzier et al. 2007). Because each

7

enterprise has unique and potentially valuable resources, or can create heterogeneous firm

resoruces, the competitive advantage can be generated if the appropriate resources are

imitated (Alvarez and Busenitz 2001). In this respect, the process of entrepreneurial activity

includes the incorporation of learning and konwledge through discovering information of the

market and coordinating disparate tacit knowelge (Alvarez and Busenitz 2001).

The extensive acknowledgement of resource-based view is not without controversy.

Priem and Butler (2001), for example, highlight that this perspective overemphasizes the

function of resource configurations that contribute to firms’ competitive advantage.

Elsewhere, the approach is said to be limited by its narrow conceptualization of firms’

resource and value based on neoclassical economic rationality, which constrains the

possibilities of making progresses (Kraaijenbrink, Spender, and Groen 2010). In contrast, the

paradoxical critique has been dismissed by Barney (2001), who insists that resource

heterogeneity and resoruce immobility perpective is still powerful in explaining management

strategies. The resource-based approach is further defended by Lado et al. (2006) who view

the resource-based paradoxes as rather instrumental for an enhanced understanding of firms

changing strategies. Nevertheless, these debates reflect an interesting yet challenging issue

for the resource-based view in conceptualizing management decision-making and business

strategies, which require a multifaceted approach to more dynamically depict firms’

competitive advantage. Recognizing this dynamic, it is necessary to extend the use of

8

resource-based view in discussing SME entrepreneurship, because the current focus is

predominantly on larger, more established firms (Kellermanns et al. 2016).

SME entrepreneurial orientation

Small and medium-sized enterprises are critical players of global trade and economy, as their

performance is highly relevant to the impact of entrepreneurial orientation and

internationalization strategy (Knight 2000). SMEs are a major driving force of eocnomy as

they have a pervasive influence acorss the business world, and in-peth analysis of SME

internatioanlization is needed to explore the under-researched topics (Ribau et al. 2016). For

SMEs, entrepreneurial orientation is linked with the degree of leadership quality on

innovativeness and proative attitudes toward the external environment (Knight 2000). It is

SMEs’ essntial dyanmic captiablity to adapt scanning and planning processes prepared for the

chaning international context (Swoboda and Olejnik 2016). However, it is also key to

understand that entrepreneurs are heterogeneous because they have indivdual-spefice

repsources that can facilitate recognizing new opportunititesa dn deploying resources for the

veture (Alvarez and Busenitz 2001). It is suggested that SMEs are deeply influenced by

globalization that provides more business opportunities, but they do not have sufficient

resources to compete with larger firms in the global market (Knight 2000).

On the other hand, due to the uncertainties brought by globalization, SMEs with an

entrepreneurial orientation can generate more opportunities to compete with other firms

9

(Knight 2000). But some elements of entrepreneurial orientation, such as international

marketing channel management, do not have a positive impact on product innovation novelty

(Boso, Oghazi, and Hultman 2017), and there is a measurement issue to safeguard the precise

study of the phenomenon itself (Randerson 2016). As the engine that drives the development

of capitalism, entreprenuerial orientation is widely perceived as a means of creating

momentum of gorwoth in many econmies (Zahra and Garvis 2000a) with consistent

conceptualization of three deminsions: innovativeness, risk taking and proactiveness (Martin

and Javalgi 2016). In a foreign market where there are different consumer needs and

competitor offerings, and economic and technological conditions, SMEs can have more

chance to success if they re highly responsive under globalization (Knight 2000). Thus

entrepreneurial orientation is important for SMEs to operate in global markets, as it can help

these firms to overcome some of the liabilities of foreingness derived from their limited

legitimacy, and to develop innovation capabilities with limited resources (Brouthers, Nakos,

and Dimitratos 2015).

In many aspects resource-based view is instrumental for explaining why SMEs can

succeed without being deferred by the weaknesses indicated by the conventional stage model

(Peng 2001). Resources refer to stocks of available tangible or intagnle factors that are owned

or controlled by the firm and converted into products or services; however, it is not always

easy to identify SME resources because of the diversification of these firms and their

10

operating environment (Ruzzier et al. 2006). Nervertheless, as stated by Rangone (1999),

entrepreneurship is a special resource for SMEs, which need to have three important basic

capatibilities on innovation, production and market management in order to develop sustained

competitive advantage. The approach depicts that due to the intensive competition of the

global market, SMEs are increasingly facing similar problems as those larger firms in

developing international activities and making decisions on internationalization (Ruzzier et

al. 2006). Smaller firms, like larger ones, have the neccessity to aquire key resources to

develop a sustainable competitive advantage, although generally there is a gap between

integrate creativity and entrepreneurial activities (Barney 2001).

Global mindset for SME entrepreneurs

The success of SMEs’ international entrepreneurship is associated with indivdiual

entrepreneurs’ global mindset, which can enable them to use relevant knowledge and

experience to identify international venturing opportunities. Global mindset is defined by

Gupta and Govindarajan (2002, 117) as ‘one that combines an openness to and awreness of

diversity across cultures and markets with a propensity and ability to synthesize acorss this

diviersity’. Elsewhere, the term is said to be an individual-level konweldge structure that can

capture and represent a unique multidimensional cognition (Levy et al. 2007), and a set of

indivdual attributes that enable people to influence others ghrough undertanding different

11

social, cultrual and institutional environments (Begley and Boyd 2003). Its cenral value is

helps to catch an insight intio the local market needs and build cognitive bridges between

these needs and the firms own global experiences and capabilities (Gupta and Govindarajan

2002).

With the continuous intensification of international competition, global mindset has

become a central dirve for long-term global competitive advantage (Levey, Beechler, Taylor

and Boyacigiller 2007). Thus creating a global mindset is a central requiremnt for buidling an

intenllengence for firms to cuccessfully exploit emerging opportunities and tackling their

accompaning chllenges (Gupta and Govindarajan 2002) Global mindset is infleunced by

entrepreneur’s education, the firm’s domestic performance and potential (Felício,

Caldeirinha, and Rodrigues 2012). It includes skills and proficiencies in relation to diversified

and complex market situation in a global envrionment, as the contextulization of the complex

situations and diversifed cultures is essentatial to develop a global mindset (French and

Chang 2016).

Global midset comprises the atributes that can enable indivduals to influence other

people or organisations from ddifferent social, cultural and instituitonal systems (Begley and

Boyd 2003). Three core properties are identified as cognitive, existentialist and behaviour, as

global mindset is a multidimentional construct that contains two primary dimensions –

culture and strategic (Levy et al. 2007), and concerns with global aspiration, capability-

12

seeking, and risk tolerance (Gaffney et al. 2014). However there has been a conceptual

ambiguity about global mindset, focusing on issues such as cultural perspective, strategic

perpective, and multidimentional perspective, at both indivdual and organizational levels

(Levy et al. 2007). Nevertheless, the notion of global mindset is focused on individuals’

proactivenss on anticipating future problems, needs and changes of intenrational markets and

managers’ commitemnt, experience and learning, as wellas psychological and demographical

information (Nummela, Saarenketo, and Puumalainen 2004). This cognitive dimension of

attention can help managers to better deal with the complex organizational environments,

strucutal indeterminacy and cultural diversity (Levy et al. 2007).

That said, global minset can often be offset by domestic business development and

entrepreneurs’ education levels (Felício et al. 2012), especially for the until-now ‘domestic-

only’ firms (Paul 2000). The extent of firms or individuals can cultivate a global mindset

depends on the curiosity about and commitment to foreign markets, comprehension of

existing mindset, diversity orientation, and ready to learn (Gupta and Govindarajan 2002).

This is particularly evident for SMEs as their key managers’ perceptions about the exsiting,

domestic market will have a significant impact on the firms’ developing strategies in an

international environment (Weaver et al. 2002). Employing experienced, global-minded

managers can quickly mend this problem, but SMEs need to redouble their efforts and make

it a top priority (Paul 2000).

13

Entrepreneur knowledge and networking

Resource-based view contents that indivdiuals’ knowledge, e.g. know-how activities, and

social interaction, e.g. netowrking activities, are critical elements for firms developing

entrepreneurial activities (Eisenhardt and Schoonhoven 1996). In the field of international

entrepreneurship, network-based studies mainly focus on network relationships, govance and

structure, as well as the benefits in helping entrepreneurs to access information and davice at

international level (Hoang and Antoncic 2003, Ruzzier et al. 2006). Howeve, firms’

internaitonal expansion does not always come from formal search, analysis and selection,

rather it is frequently based on an interaction between entrepreneurs and their social and

business networks, because it is possibly more effective to find solutions in exsiting

relationships (Evers and O’Gorman 2011). With networks being recognized as firms’ key

resources, the concept of knowledge networks have been put forward to describe how firms

can collaborate and innovate trhough contact and allicance networks (Huggins and Johnston

2010). Through networking with well-regarded indivduals and organizations, entrepreneurs

can find resoruce-holders who are potential investors and employees to exchange beneficiary

resources and discover innovative opportunities (Hoang and Antoncic 2003).

It has been found that networking can result in information access and structural

changes of entrepreneurial activities over time, with improved networking capabilities

helping to facilitate greater venture legitmacy and benefit external relations (Batjargal 2010,

14

Hoang and Antoncic 2003, Parida et al. 2017). With networks leading to inter-firm

communication and exchange, knowledge transfer can play an important role in firms’ cross-

border expansion building on the Uppsala model, the network approach to

internationalization believes that firms can invest in new networks, increase reseouce

commitements in networks, and integrate different national networks (Johnson and Vahlne

1990). According to Wu, Pangarkar, and Wu (2016), marketing know-how and technolgoy

know-how are two major knowledge transfer activities at international level, with the former

requiring more attention to build new relationships in a new market setting, and the latter

being easier to be transferred because technological advantage can lead to better returns, even

in a newly developed foreign environment. Social relationship with other individuals is a sub-

network within the business network, and is key to provide the context for firms’

international activities, although it is less clear how SMEs can use resources and develop

strategies (Ruzzier et al. 2006). During this process, knowledge flows through social

networks and becomes social capital, while the eocnomic rationality explains why firms will

invest in calculative networks to get access to required information (Huggins and Johnston

2010).

Research has addressed that the prospect of SME internationalization is postively

related to individuals’ human capital and social capital such as management know-how

(Wright et al. 2007). Having diverse management know-how is likely to enhance firms’

15

human resourc practices and explore more promising opportunities in foreign markets

(Westhead, Wright, and Ucbasaran 2001), although firms’ international tendency lies on the

entrepreurs’ idosyncratic prior knowledge (Evers and O’Gorman 2011) It is also percieved

that marketing know-how is important for firms’ internationalization, although knowledge

transfer, intepretation and absorbing are not an easy process (Simonin 1997). But due to

resource scarcity and a tendancy of devleoping networks locally (Huggins and Johnston

2010), SMEs tend to have many difficulties in building formal business relationships in the

international market, so they need to be more proactive in exploiting knowelge-based internal

resources (Tang 2011) before they can set off to discover external opportunities.

Chinese SMEs’ internationalization

As the world’s largest emerging economy, China has benefited from the rapid development

of an internationally orieated growth in recent decades. The advancement of emerging

markets, including China, has intensified the need for global mindset because it facilitates the

needs for interacting with culturally diversified counterparts overseas (Gaffney et al. 2014).

Intgernational venturing can enchance firm perfromance by using its existing knoweldge and

resources in new markets, and use innovation, risk taking and proactivenss to enahcne firm’s

ability and recogition to exploite foreign market opportunities (Zahra and Garvis 2000a). In

recent years, the Chinese government has strived to improve business environment for

16

inspring innovative actviteis and nurture long-term SME innovation, with a nubmer of new

legislations and regulations having been deployed to recognize and capitalize the transition of

SMEs (Tang and Hull 2012). The degree of entrepreneurial orientation in China is influenced

by the extent of institutional environment for private owndership and the perosnal attributes

of would-be entrepreneurs (Lu and Tao 2010). On the one hand, there is an increasingly

supportive cognitive environment that fosters an entrepreneurship-related enductaion and

training system, and facilitates incubators and foundations to help establish and operate new

businesses (Tang and Hull 2012). On the other hand, Chinese SMEs tend to behave

cautiously due to the country’s opprotunistic competition derived from inadequate protection

to entrepreneurial businesses (Tang and Hull 2012).

To develop an internationally orientaed strategy, it is critical for SMEs to use

networks that can provide important social capital (Huggins and Johnston 2010), which is

instrumental for oevercoming China’s institutional deficiences and sustaining international

targets (Kiss, Danis, and Cavusgil 2012). There have been well-documented discussions

about the Chinese version of networks, guanxi, which refers to the interpersonal relationships

that are linked to social exchanges, while its central element is the process of establishing,

maintaining and mobilizing personal ties (Batjargal 2010). From the perspective of resource-

based view, Chinese entrepreneurs’ personal attributes such as education are key resources in

helping SMEs to develop opportunity-driven behaviours in the international market (Alon et

17

al. 2013). Among others, social relationship established through networking activities is an

extremely important resource-expansion method for Chinese SMEs to develop their global

business. In the Chinese context, guanxi derives from the network approach to

entrepreneurship in the venture creation and development processes, with the Chinese culture

deeply integrated with the instrumental usefulness of guanxi in making resources accessble,

helping to maintain the growth momentum of entreprenurial firms (Guo and Miller 2010).

This is based on the traditional Confucian culture, which implies the central position of the

networks of interpersonal relationship (Su et al. 2015). For those Chinese SMEs without

sufficient resources, local guanxi may provide important social capital that is important for

their international entrepreneurial strategeis, while they can also use political ties to receive

more favourable government funding in innovation, reduce more risk, and to faciliate quicker

convertions of international opportunities into actions (Zhang et al. 2016). However, care

must be take because guanxi is unique to the Chinese context, and it is not easy to generalize

or expand this proposition into alternative environment.

Development of hypotheses

International entrepreneurship hypotheses

Explaining SMEs’ international behaivour remains an important paradox since entpreneurial

orientation, which refers to tendency to innovate and provocate, is a multidimentional

18

concept (Zhang et al. 2012). Entrepreneurial orientation therefore shows a firm’s proclivity to

anticipate, act and react according to external changes, as well as utilizing novel behaivours

such as investing with uncertain outcomes (Lumpkin and Dess 1996). SMEs with

entrepreneurial orientation can leverage marketing strategies into new product markets and

respond to complicated environments, as well as applying innovative strategeis through

product specialization (Knight 2000). To develop international business, entrepreneurs need

to discover, enact, evaluate and epxloit new cross-border opportunities to create future

development that is based on domestic market (Oviatt and McDougall 2005, Wang, Chung,

and Lim 2015).

Existing studies have documented that SMEs with high entrepreneurial orientation are

more likely to diversify their activites, expand in an uncertain international market and

improve international performance, although these effects may be constrained by limited

available resources (Brouthers et al. 2015, Jantunen et al. 2005, Knight 2000). International

entrepreneurial activities are complex and costly, involving both new product lines and new

geographic markets, and requesting entrepreneurs to thorougly investateg opportinies and

build infrastruure (Wang et al. 2015). During this rsiky operation process, firms need to

decide a trade-off straegies on short-term financial loss and logn-term gain (Wang et al.

2015). As Fernhaber, Gilbert, and McDougall (2008) indicate, in comparison with larger

firms, SMEs have to confront with more difficiluties to garner the reosurces needed to

19

develop international opportunities, and they are less likely to expand internationally if the

local market could satisfy their needs for resources. But overall, entrepreneurial orientation

enables firms to develop key capabilities for creating competitive advantage (Lee, Lee, and

Pennings 2001), and better uilizing internal and external resources (Wiklund and Shepherd

2003). Because there is a lack of attention to the role of international entrepreneurship in

China, the world’s largest emerging eocnomy (Naudé and Rossouw 2010), we propose:

H1: Chinese SME’s entrepreneurial orientation is positively related to the degree of

internalization.

Related to the entreprenuerial orientation paragigm is the form of individuals’ global

mindset that can offer conditions to develop cross-border networks, with strong influence on

firms’ financial toucome and business growth (Felício et al. 2012). Global mindset is the

capacity to observe and accept diversified cultures and markets for creating opportunities

(Rogers and Blonski 2010) and postulating strategies and actions in intenratinal arena (Levy

et al. 2007). Its main content includes global prospensity and cognition, knowledge,

orientation and behaviour (Felício et al. 2015). Global orientation, as Felício et al. (2012)

state, relates to the expectation and commitment to comprehend international markets and

networs, exhibited with global knowledge and aptitude that allow firms to explore global

business opportunities. It is therefore suggested that individuals with a global mindset possess

‘a highliy complex congnitive structure characterized by an openness to and articulation of

20

multiple cultural and strategic realities on both global and local levels, and the cognitive

ability to mediate and integrate across this multiplicity’ (Levy et al. 2007, 244).

A close contemplation of entrepreneurship research further reveals the dynamic

relationships between global mindset and the internaitonalization of SMEs. Entrepreneurship

and innovation are critical for developing a competitive eocnomy, as global mindset can be

triggered by entrepreneurs’ strong interest in devleloping international business through

openning ideas in markets abroad (Felício et al. 2012). Due to the diversified, complex, and

constantly chaning international market (Tang and Hull 2012), global thinking is needed to

help assoicate local cultures and opporuttnies with firms’ developmental targets (Gupta and

Govindarajan 2002). Meanwhile, global mindset is necessary but not suffiicent for becoming

effective in managing globally (Levy et al. 2007), as international experience does not

naturally lead to developing a global mindset without individuals’ inquisitivenss and

openness (Bird and Osland 2004). But overall, the inernationalization behaiovur of SMEs is

one of the key determnants of entrepreneurs and their mindset (Felício et al. 2012). We can

therefore suggest that:

H2: Chinese SME owners/managers’ global mindset is positively related to the degree

of internalization.

Knowledge and social network hypotheses

With valuable episodic knowledge on industries or production, individual entrepreneurs can

21

learn and assess their ability to export (Wright et al. 2007). However, such know-how

capacity is not universal, as some enrepreneurs may be more adept than others in finding

opportunities to internationalize their products and services (Wright et al. 2007). In their

study, (Cardoza and Fornes 2011)find that one of the major barriers for Chinese SMEs to

internationalize their business is the weak management skills on assistance, communication

and time, and knowledge of international finance. Such know-how activity is important for

firms since businesses need to continously explore new opportunities to respond to an

increasingly uncertain and changing market situation (Martin and Javalgi 2016). Yet the

degree of overseas’ market hostility can also moderete the success of international

entrepreneurship (Zahra and Garvis 2000a), while there is a bidirectional mediating

relationship between SMEs’ international entrepreneurial orientation and processes (Swoboda

and Olejnik 2016). Due to different types of network ties at home, such differences can

moderate the impact of entrepreneurship on SMEs’ international activites (Zhang et al. 2016).

It has been found that with networking, firms may be able to simultaneously capture

the unfolding entrepreneurial process and the evolving social relationships between

entrepreneurs and other people (Larson and Starr 1993). However, international networking

does not always have a positive impact on firms’ financial perofrmanc (Bai, Holmström Lind,

and Johanson 2016). In addition, the network approach is said to hve neglected the strategic

position and influence of individual entrepreneurs in the interantionalization of SMEs

22

(Ruzzier et al. 2006), and the role of knowledge is still underdiscovered for its impact on

glboal mindset (French and Chang 2016). Entrepenuers’ social relations and business

networks help them to acuqire necessary reources to explore speicific foreign markets and

exchange partners (Evers and O’Gorman 2011, Greve and Salaff 2003). Entrepreneurs tend to

control information flows and generate greater credit slips if their network position is central

within disconncted clusters, as these structrual holes may lead to greater structural autonomy

and positive impact on entrepreneur success because it helps to facilitate swift response to

new opportunities through networking activities and neutralize negative impacts (Batjargal

2010). This explains why Chinese entrepreneurs incline to create actviely structural roles in

their network (Batjargal 2010), because guanxi networks are essential for Chinese firms to

achieve entrepreneurial success by overcoming environmental barriers and resource

deficiency in the context of the country’s rapid economic transformation (Guo and Miller

2010). Based on the disucssion above, we propose the following hypotheses:

H3a: Chinese SME’s entrepreneurial orientation is positively related to international

networking activities.

H3b. Chinese SME’s entrepreneurial orientation is positively related to international

know-how activities.

H4a: Chinese SME’s owner/manager global mindset is positively related to

international networking activities.

H4b: Chinese SME’s owner/manager global mindset is positively related to

international know-how activities

23

Mediating effect

SMEs’ internationalization is a multidimentional activity that is shaped by both internal and

external factors, and the changing external environment also requires firms to take a flexible,

adaptive approach to develop continuous competitive advantage. In the process of deploying

resource-consuming global expansion, SMEs’ interantional networking and know-how

activities, as well as competitive intensity, have important mederation effect on the degree of

internationalization (Felício et al. 2015, Martin and Javalgi 2016). To this end, the

relationships between interantioanl activties, know-how activties, global mindset and

entrepreneurial orientation tend to be elastic and changeable. Since global thinking can help

integrate firms’ knowledge structure by distinguishing the commonalities of different cultures

and markets, it is necessary to identify the links between specific behaviour attributes and

global mindset can lead to international actions (Levy et al. 2007).

On the other hand, current studies have not paid enough attention to survey cognitive

filters and knowledge structures for conceptualization of global mindset, which comes from

accumlated (or acquired) knoweldge through external activities (French and Chang 2016).

Thus an exploration of the mediating effect of foreign operations is conspicuous for

understanding the influence of entrepreneurial orientation and global mindset during this

process (Terjesen, Hessels, and Li 2016) . First, networking can optimize market information

and modify individual entrepreneurs’ knowledge about global market opportunities, which

24

are essential for SMEs’ international expansion (Knight and Liesch 2002, Kyvik et al. 2013).

Through networking with customers, firms may develop market specific knoweldge that will

contribute to the success of firm’s internationalization (Soriano and Dobon 2009)

(Weerawardena et al. 2007) . Since global mindset has significant effects on information-

processing patterns for manageiral capbilities (Levy et al. 2007), SMEs may have to confront

with challenges arising from limited resources that support langauge skills, management

strategy and capacity to acknowledge complex situations (Felício et al. 2012). Thus

entreprenuers’ global mindset and international orientation may be limited by a narraw scope

in networking.

Second, there is insuffient empirical evidence reporting the constraint effect of

international know-how activities on SMEs’international entrepreneurship. It has been

suggested that global mindset can stronlgy influence SMEs’ finacial results on the

development of specialization and know-how, the propensity to share knowledge and the

choice of using international networks to discover market opportunities (Felício et al. 2015).

Technology know-how and marketing know-how also have moderation effect on the

relationship between regional and international business expansion (Wu et al. 2016).

Meanwhile, firms’ internationalization is influenced by the know-how acquisition process,

during which individual managers maintain and improve global mindset of international

activities (Weerawardena et al. 2007). For instance, knowledge ambiguity and complexity

25

can negatively affect the propensity to transfer knowledge through learning (Simonin 1997),

and this may influence the development of global mindset and international entreprenuership

for individual SME managers. For Chinese SME entrepreneurs, therefore, their

internationalization processes are shadowed by a flexible know-how approach dealing with

the changing innovation engagement and incentives due to a volatile regulaotry environment,

which is featured with sometimes random and arbitrary policy making and enforcement,

uneven government support to larger firms or SOEs (Dimitratos et al. 2016, Zhang et al.

2012). Thus, we propose:

H5a: International networking activities mediate the relationship between

entrepreneurial orientation and the degree of internalization.

H5b: International know-how activities mediate entrepreneurial orientation and the

degree of internalization.

H6a: International networking activities mediate the relationship between global

mindset and the degree of internalization.

H6b: International know-how activities mediate the relationship between global

mindset and the degree of internalization.

A conceptual framework of this study has been developed to reflect the above

hypotheses (Figure 1).

Figure 1: Theoretical framework

26

Figure 1 conceptual model

Research method

The emprical data for this study were collected by using a survey questionnaire, which was

first developed in English, translated into Chinese by a bilingual professor of business

studies, and back-translated by a second bilingual professor in the same subject area. Minor

ajustments were made following the discussion of the two professors and the authors. The

construct measures in the questionnaire were based on sources from the extant literature.

Dependent variable. The degree of interationalization is measured by two indicators:

geographic coverage and foreign market involvement. Geographic coverage was measured

27

using the number of foreign countries that the company has business invonvment, including

selling of its products (Lu and Beamish 2001). Foreign market involvement was measured by

the major mode of market entry mode that campany adopted, i.e. exporting, strategic alliance,

joint venture, and wholy-owned subsidary.

Independent variables. For entrepreneurial orientation, we followed Zhang et al.

(2016) and adopted the commonly used ten items developed by Covin and Slevin (1989) and

Zahra and Garvis (2000b) to measure a firm’s innovativeness, proactiveness and risk-taking.

Global mindset was measured by 3 items selected from behaviour in Felício et al. (2015).

Mediators. The mediators include international networking activities and international

know-how activities, and their measures were also adopted from Felício et al. (2015) and Bai

et al. (2016).

Control variables. Control variables included firm size (number of employees),

annual sale volume, firm age, and industry.

Sample and data collection

We developed an online version of the questionnaire hosted by ‘Sojump.com’ (a large scale

commercial survey website in China, similar to Survey Monkey) to collect empirical data

and test our hypotheses. The target population for this study consists of owners or key

decision makers (owners/managers) at private-own companies originating in China (Fabian

and Molina 2009, Zhang et al. 2016). We approached a nation-wide SME trade association

28

(with approx. 2000 members) and secured its collaboration in recruiting survey participants.

The SME trade association sent out invitation to member organizations via social network

application, WeChat group function. The use of social media WeChat is justified because it

has been widely used by Chinese SME owner/manager to communicate with each other,

exchange commercial information, and build social networks. Furthermore, it is a highly

efficient and effective means to reach and engage with the potential research participants, in

comparison with traditional tools such as postal or drop-and-collect surveys.

Following the definition of SME by the European Union (European Commission

Small Business, 2009), to be included in the study, the repondent’s company should have

fewer than 250 employees (Brouthers et al. 2015). We use Partial Least Squares Structural

Equation Modeling (PLS-SEM) to as test our model.

Results

The average number of countries the sample SMEs have business relation is 5.14, the average

number of staff is 123, and the average sale is 142 million Chinese Yuan. Other company

demographic variables are listed in Table 1. The history of the sample companies are mostly

between 6-15 years. The majority of them are in electronics and textile industries. The modes

of international involvement are mainly export (74%).

29

Table 1 Company profile

Company age Frequency percentage

1-5 years 28 13.5

6-10 years 67 32.2

11-15 years 76 36.5

16-20 years 22 10.6

20 and above 15 7.2

Industry

Textile and garment 50 24

Chemical, rubber and plastic products 37 17.8

Metal and machinery 37 17.8

Electronic, optical, electrical products 73 35.1

Others 11 5.3

Involvement

Export 154 74

Strategic alliance 29 13.9

Joint venture 18 8.7

Direct investment/Subsidiary 7 3.4

Measurement model results

We treated entrepreneurial orientation as a second order reflective construct, with the first-

30

order features of innovation (0.843), proactivness (0.834), risk-taking (0.749), the loadings

were well above recommended level of .7. We treated the degree of internationalization as a

formative construct consisting two indicators: geographic coverage and mode of international

involvement (0.401 and 0.874 respectively).

For reflective constructs, the measurement model examines convergent validity and

discriminant validity. Table 2 shows the average variance extracted (AVE) and composite

reliability (CR) for each first-order construct. According to Hair, Ringle, and Sarstedt (2011),

the recommended level of AVE is 0.5 and the recommended level of CR is 0.7. All the data

as shown in Table 2 meet the requirements. Thus convergent validity of the measures was

verified.

Table 2 Convergent validity

AVE

Composite

Reliability

Global mindset 0.640 0.842

Innovation 0.575 0.802

Know-how activities 0.616 0.828

Pro-activeness 0.517 0.762

Risk-taking 0.681 0.865

Networking activities 0.562 0.794

31

For the test of discriminant validity, one needs to examine cross loadings and

comparing the square roots of the AVE (Hair et al. 2011) and the correlations between latent

variables (Fornell and Larcker 1981). As shown in Table 3, each indicator loads higher on

their respective construct than on others. Table 4 shows that the square roots of the AVEs

exceed the correlations between every pair of latent variables. Thus discriminant validity can

be confirmed.

Table 3 Cross-loadings

Global

mindset

Innovatio

n

Know-

how act

networkin

g act

Pro-

activenes

s

Risk-

taking

glob1 0.791 0.528 0.473 0.548 0.454 0.090

glob2 0.779 0.469 0.556 0.532 0.487 0.147

glob3 0.828 0.454 0.491 0.554 0.517 0.150

inn1 0.56 0.801 0.437 0.487 0.516 0.275

inn2 0.452 0.746 0.411 0.437 0.473 0.323

inn3 0.354 0.725 0.324 0.486 0.404 0.316

know1 0.408 0.393 0.773 0.415 0.467 0.306

know2 0.501 0.379 0.816 0.548 0.545 0.332

know3 0.574 0.443 0.764 0.580 0.422 0.241

network1 0.579 0.574 0.549 0.779 0.513 0.348

network2 0.504 0.382 0.490 0.733 0.407 0.182

32

network3 0.436 0.416 0.438 0.736 0.313 0.292

pro1 0.353 0.356 0.315 0.346 0.683 0.367

pro2 0.521 0.515 0.537 0.455 0.755 0.270

pro3 0.430 0.447 0.453 0.398 0.718 0.282

risk1 -0.024 0.259 0.175 0.222 0.219 0.772

risk2 0.206 0.411 0.384 0.404 0.450 0.885

risk3 0.184 0.302 0.333 0.266 0.345 0.816

Table 4 Correlations and quare root of AVEs

Global

mindset

Innovatio

n

Intl

Know-

how act

Pro-

activeness

Risk-taking

Networkin

g activities

Global mindset 0.800

Innovation 0.605 0.758

Internationalisation -0.070 -0.174 NA

Know-how activities 0.635 0.517 0.060 0.785

Pro-activeness 0.608 0.614 -0.067 0.610 0.719

Risk-taking 0.162 0.401 -0.066 0.372 0.423 0.825

33

Networking

activities

0.681 0.620 -0.141 0.661 0.558 0.371

0.750

Notes: Boldface numbers on the diagonal are the square root of the average variance extracted.

Structural model results

Figure 2 presents the structural model results, which indicate that the aggregate path

coefficients are statistically significant. R² values for networking activities and know-how

activities were 55.9% and 50.1% respectively, indicating adequate explanatory power (Hair

et al. 2011). However the R² for degree of internationalization is weak (11.5%).

The results indicate that H1 and H2 were not supported. Neither entrepreneurial

orientation nor global mindset has a significant positive effect on the degree of

interationalization (β=-0.139, t=1.204; and β=-0.029, t=0.236, respectively).

Entrepreneurial orientation does have a positive significant effect on international

networking activities (β=0.375, p<0.01), and nternational know-how activities (β=0.38,

p<0.01), thus H3a and H3b can be supported.

Global mindset was also found to have a positive effect on international networking

activities (β=0.468, p<0.01), as well as on international know-how activities (β=0.418,

p<0.01), thus H4a and H4b can be supported.

34

Figure 2: Structural model results

Note: *p < 0.05; **p <0.01;

There was no positive relationship between social networking activities and degree of

internationalisation (β=-0.273, p<0.05), therefore there is no need to run a mediation test. As

a result, we can say that H5a was not supported by our evidence, i.e. there was no mediation

effect of international networking activities on the relationship between entrepreneurial

orientation and the degree of internalization. For the same reason, H6a cannot be supported

35

either, that is, international networking activities do not mediate the relationship between

global mindset and the degree of internalization.

Given that international know-how activities have a significant positive effect on

internationalisation (β=0.335, p<0.01), we ran two sets of mediation analysis using

bootstrapping procedure. The results show that H5b was supported, i.e. international know-

how activities mediate entrepreneurial orientation and the degree of internalization (indirect

effect=0.128, SE= 0.048, t-value=2.660, 95%LL=0.034, 95%UL=0.222); and H6b was also

supported, i.e. International know-how activities mediate the relationship between global

mindset and the degree of internalization (indirect effect=0.14, SE=0.062, t-value=2.265,

95%LL =0.019, 95%UL=0.262). Table 5 summarises the results of hypothesis testing.

Table 5 Results of hypothesis testing

Hypotheses Supported?

H1 EO Internationalisation No

H2 Global mindset Internationalisation No

H3a EO International networking activities Yes

H3b EO International know-how activities Yes

H4a Global mindset International networking activities Yes

H4b Global mindset International know-how activities Yes

H5a EO International networking activities Internationalisation No

H5b EO International know-how activities Internationalisation Yes

36

H6a Global mindset International networking activities Internationalisation No

H6b Global mindset International know-how activities Internationalisation Yes

Limitations

The results provide valuable ovservation about Chinese SMEs’ internationalization activities

associated with the degree of entrepreneurship and global mindset, as well as the mediation

effect of know-how and networking activities; however, the research is constrained by a

number of limitations. First, our samples are from a pool of 2,000 Chinese SMEs in a nation-

wide trade association, which means it is not clear whether our findings can be generalizable

to those SMEs outside this national organization. Second, although using social media, e.g.

WeChat applications, to invite participants can be quick and efficient, sometimes social

media research may suffer from difficulties of accurately understanding and interpreting

individuals’ attitudes and motivations (Branthwaite and Paterson 2011). Third, given the

sampling method follows the European Union’s definition for SME that has up to 250

employees, an expansion to those firms with 250 – 500 employees as defined as SMEs in the

United States because may help determine if the research findings need to be generalized to

other firms (Brouthers et al. 2015). Fourth, the current research does not distinguish different

ownerships of Chinese SMEs, and this feature is potentially influential on these firms’

resources that enable them to carry out international activities. Compared with the state-

owned enterprises, private frims, especially private SMEs, may face more challenges for

getting government support and sufficient information because of their insufficient resources

in finance, human resources and social capital. Further research could look at these issues

again and collect data from a wider range of objects, and a closer examination of different

ownership may offer better understanding of how ownership is correlated with the

37

performance of Chinese SMEs when they engage with international activities. In addition,

our conceptual model shares limitation addressed by Ruzzier at al. (2006) as it is

comprehensive but not exhaustive, so a future research should deploy a longitudinal method

in order to identify more expansive interactions among key factors of SME

internationalization.

Discussion and conclusions

Despite the limitations, our study makes novel contributions to both entreprenurship literature

and intenational practice for Chinese SMEs. By examining the role of entrepreneurial

orientation, global mindset on two international activities: networking and know-how, and

subsequently on the degree of firms’ internationalization, this study makes a unique attempt

to advance our understanding of Chinese SMEs’ strategies and practics in the global market.

A conceptual model was developed and tested with a sample of 208 small and medium size

firms from China. The results indicate both entrepreneurial orientation and global mindset

have positive effects on international networking and know-how activities, though they do

not have a direct effect on the degree of internationalization. This unantipicated result is

surprising; however, it is consistent with the fact that the development of Chinese SMEs is

constrained by the country’s exsiting institutional mechanism that puts more weight on larger

and state-owned firms (Lu and Tao 2010, Zhang et al. 2016).

Our study advances entrepreneurship research by delineating the characters of interantional

veturing activities in the world’s largest emerging economy and further the conceputal

antecedent within entrepreneurship research. The findings shed light on the factors

influencing Chinese SMEs’ internationalization process. Our study addresses the research

38

gap on resource-based research that pays insufficient attention to entrepreneurship (Alvarez

and Busenitz 2001) in general, and the international venturing activities for Chinese SMEs in

particular. It enriches the theoretical horizon in conceptualizing firms’ international

behaivour by linking individual entrepreneurs’ attributes and strategies with the

organizations’ development at the international arena.

This research may make a contribution to the resource-based view on business venturing

because the findings demonstrates a surprising result different from our hypotheses on the

mediation effect of the firm’s resources such as know-how and networking activities. As the

results show, these Chinese SMEs’ international networking activities have no mediation

effect on the relationship between the degree of internationalization and managers’/owners’

global mindset. However, empirical evidence does indicate an indirect mediation effect of

SMEs’ international know-how activity on this relationship. Following the call that the

resource-based view related research needs to focus more on SME entreprenuership (Barney

et al. 2001), our findings extend the boundaries of this approach by further envisioning the

extent to which Chinese SMEs’ international activities are influenced by individuals’

knowledge resource and social capital.

A number of implications can be identified as a reuslt of the current study. First, the research

implies that SME managers need to engage more on learning, rather than networking,

activities in the international arena because the latter does not have significant impact on the

firm’s international entreprenuial orientation and individuals’ global mindset. Contrary to

Batjargal’s (2010) annotation encouraging entreprenuers to be socially creative and alert to

new international networking methods, the current study suggests that the knowledge of

international market and relevant learning processes are more important for Chinese SMEs to

39

expand in foreign environments. Secondly, despite the insignificant role of networking on

international entreprenuership, it is imperative for managers and owers in Chinese SMEs to

explore international venturing opportunities through networks because it is a perceived

channel for the firm to expand in a wider range of market. Instead of overstating or

undermining the guanxi effect in international business activities, a recognition of the

function of guanxi network is pivotal for both researchers and entrepreneurs to appreciate the

importance of this indispensable part of Chinese culture.

Third, the findings suggest that in these Chinese SMEs, individuals’ global mindset and

entrepreneurial orientation has little impact on the degre of internationalization. The survey

response implies that SME owners or managers may be frustrated by the institutional barriers

that have led to resource shortage detrimental for them to carry out international activities.

Even with active plans and innovative thinking, the resource constraint arising from

institutional barriers can subotage individuals’ passion on undertaking international venturing

activities. A policy implication of this finding is that the government support is very

important for Chinese SMEs as the domestic environmental factors, such as finance, taxation,

credit assurance and human resources, are critical for these firms to develop further in foreign

markets.

Indeed, despite the growing attention to the recent development of entrepreneurship in China

(Batjargal 2010, Dimitratos et al. 2016, Lu and Tao 2010, Su et al. 2015, Zhang et al. 2012,

Zhang et al. 2016), we know little about how Chinese SMEs’ internationalization is

influenced by individuals’ global mindset and entrepreneurial orientation, as well as the

mediation effect of international know-how and networking activities. Drawing on the

resource-based view and the Chinese culture of social capital, our study suggests that among

40

these factors there is a dynamic interplay that is quite distinctive from the correlation found in

other countries. Hence, the scanty influence of international entrepreneurial orientation on

shaping the degree of internationalization may reflect for the Chinese SMEs surveyed a

realistic strategy in light of insufficient policy support. Another possible reason can be found

in the context-specific explanation that highlights the essence of China’s emerging and

transition economy as unique characters (Zhang et al 2016) that may influence firms’

internationalization. Thus the most important policy implication of this study is how to

promote Chinese SMEs’ global expansion that is challenged by the absence of an

instrumental institutional environment. This requires further and more in-depth investigation

of the relationships between firm performance, international entrepreneurship and internal

resources for Chinese SMEs. Such probe would need a broader range of samples, a

longitudinal framework and a mixed-ownership approach.

41

References

Alon, I., O. Yeheskel, M. Lerner, and W. Zhang. 2013. "Internationalization of Chinese entrepreneurial firms." Thunderbird International Business Review 55 (5):495-512.

Alvarez, S. A., and L. W. Busenitz. 2001. "The entrepreneurship of resource-based theory." Journal of Management 27 (6):755-775. doi: 10.1177/014920630102700609.

Bai, W., C. Holmström Lind, and M. Johanson. 2016. "The performance of international returnee ventures: the role of networking capability and the usefulness of international business knowledge." Entrepreneurship & Regional Development 28 (9-10):657-680.

Barney, J. B. 2001. "Resource-based theories of competitive advantage: A ten-year retrospective on the resource-based view." Journal of Management 27 (6):643-650.

Batjargal, B. 2010. "Network dynamics and new ventures in China: A longitudinal study." Entrepreneurship & Regional Development 22 (2):139-153.

Begley, T. M., and D. P. Boyd. 2003. "The need for a corporate global mind-set." MIT Sloan Management Review 44 (2):25.

Boso, N., P. Oghazi, and M. Hultman. 2017. "International entrepreneurial orientation and regional expansion." Entrepreneurship & Regional Development 29 (1-2):4-26. doi: 10.1080/08985626.2016.1255430.

Branthwaite, A. and S., Patterson. 2011. “The Power of qualitative research in the era of social media.” Qualitative Market Research: An International Journal 14 (4): 430 – 440.

Brouthers, K. D., G. Nakos, and P. Dimitratos. 2015. "SME entrepreneurial orientation, international performance, and the moderating role of strategic alliances." Entrepreneurship Theory and Practice 39 (5):1161-1187.

Cardoza, G., and G. Fornes. 2011. "The internationalisation of SMEs from China: the case of Ningxia Hui autonomous region." Asia Pacific Journal of Management 28 (4):737-759.

Covin, J. G., and D. P. Slevin. 1989. "Strategic management of small firms in hostile and benign environments." Strategic Management Journal 10 (1):75-87. doi: 10.1002/smj.4250100107.

Dimitratos, P., T. Buck, M. Fletcher, and N. Li. 2016. "The motivation of international entrepreneurship: The case of Chinese transnational entrepreneurs." International Business Review 25 (5):1103-1113.

Eisenhardt, K. M., and C. B. Schoonhoven. 1996. "Resource-based view of strategic alliance formation: Strategic and social effects in entrepreneurial firms." organization Science 7 (2):136-150.

42

Etemad, H. 2015. "Entrepreneurial orientation-performance relationship in the international context." Journal of International Entrepreneurship 13 (1):1.

Evers, N., and C. O’Gorman. 2011. "Improvised internationalization in new ventures: The role of prior knowledge and networks." Entrepreneurship & Regional Development 23 (7-8):549-574.

Fabian, A. P. F., and H. Molina. 2009. "Understanding decisions to internationalize by small and medium-sized firms located in an emerging market." Management International Review 49 (5):537-563.

Felício, J. A., V. R. Caldeirinha, and B. Ribeiro-Navarrete. 2015. "Corporate and individual global mind-set and internationalization of European SMEs." Journal of Business Research 68 (4):797-802. doi: http://dx.doi.org/10.1016/j.jbusres.2014.11.031.

Felício, J. A., V. R. Caldeirinha, and R. Rodrigues. 2012. "Global mindset and the internationalization of small firms: The importance of the characteristics of entrepreneurs." International Entrepreneurship and Management Journal 8 (4):467-485.

Fernhaber, S. A., B. A. Gilbert, and P. P. McDougall. 2008. "International entrepreneurship and geographic location: an empirical examination of new venture internationalization." Journal of International Business Studies 39 (2):267-290. doi: 10.1057/palgrave.jibs.8400342.

Fornell, C., and D. F. Larcker. 1981. "Evaluating structural equation models with unobservable variables and measurement error." Journal of Marketing Research 18 (1):39-50. doi: 10.2307/3151312.

French, R. P., and H. Chang. 2016. "Conceptual re-imagining of global “mindset”: Knowledge as prime in the development of global leaders." Journal of International Organizations Studies 7 (1):49-62.

Gaffney, N., D. Cooper, B. Kedia, and J. Clampit. 2014. "Institutional transitions, global mindset, and EMNE internationalization." European Management Journal 32 (3):383-391.

Greve, A., and J. W. Salaff. 2003. "Social networks and entrepreneurship." Entrepreneurship Theory and Practice 28 (1):1-22.

Guo, C., and J. K. Miller. 2010. "Guanxi dynamics and entrepreneurial firm creation and development in China." Management and Organization Review 6 (2):267-291.

Gupta, A. K., and V. Govindarajan. 2002. "Cultivating a global mindset." The Academy of Management Executive 16 (1):116-126.

Hair, J. F., C. M. Ringle, and M. Sarstedt. 2011. "PLS-SEM: Indeed a silver bullet." The Journal of Marketing Theory and Practice 19 (2):139-152.

Hall, C. 2007. "When the dragon awakes: Internationalisation of SMEs in China and implications for Europe." CESifo forum.

43

Hoang, H., and B. Antoncic. 2003. "Network-based research in entrepreneurship: A critical review." Journal of Business Venturing 18 (2):165-187.

Huggins, R., and A. Johnston. 2010. "Knowledge flow and inter-firm networks: The influence of network resources, spatial proximity and firm size." Entrepreneurship & Regional Development 22 (5):457-484.

Jantunen, A., K. Puumalainen, S. Saarenketo, and K. Kyläheiko. 2005. "Entrepreneurial orientation, dynamic capabilities and international performance." Journal of International Entrepreneurship 3 (3):223-243.

Johnson, J., and J. Vahlne. 1990. "The mechanism of internationalization." International Marketing Review 7 (4):11-24.

Kellermanns, F., J. Walter, T. R. Crook, B. Kemmerer, and V. Narayanan. 2016. "The Resource‐Based View in Entrepreneurship: A Content‐Analytical Comparison of Researchers' and Entrepreneurs' Views." Journal of Small Business Management 54 (1):26-48.

Kiss, A. N., W. M. Danis, and S. T. Cavusgil. 2012. "International entrepreneurship research in emerging economies: A critical review and research agenda." Journal of Business Venturing 27 (2):266-290.

Knight, G. 2000. "Entrepreneurship and marketing strategy: The SME under globalization." Journal of International Marketing 8 (2):12-32.

Knight, G. A., and P. W. Liesch. 2002. "Information internalisation in internationalising the firm." Journal of Business Research 55 (12):981-995.

Kraaijenbrink, J., J.-C. Spender, and A. J. Groen. 2010. "The resource-based view: a review and assessment of its critiques." Journal of Management 36 (1):349-372.

Kyvik, O., W. Saris, E. Bonet, and J. A. Felício. 2013. "The internationalization of small firms: The relationship between the global mindset and firms’ internationalization behavior." Journal of International Entrepreneurship 11 (2):172-195.

Lado, A. A., N. G. Boyd, P. Wright, and M. Kroll. 2006. "Paradox and theorizing within the resource-based view." Academy of Management Review 31 (1):115-131.

Larson, A., and J. A. Starr. 1993. "A network model of organization formation." Entrepreneurship: Theory and Practice 17 (2):5-16.

Lee, C., K. Lee, and J. M. Pennings. 2001. "Internal capabilities, external networks, and performance: a study on technology-based ventures." Strategic Management Journal 22 (6-7):615-640. doi: 10.1002/smj.181.

Levy, O., S. Beechler, S. Taylor, and N. A. Boyacigiller. 2007. "What we talk about when we talk about ‘global mindset’: Managerial cognition in multinational corporations." Journal of International Business Studies 38 (2):231-258.

Lu, J., and Z. Tao. 2010. "Determinants of entrepreneurial activities in China." Journal of Business Venturing 25 (3):261-273.

44

Lu, J. W., and P. W. Beamish. 2001. "The internationalization and performance of SMEs." Strategic Management Journal 22 (6-7):565-586. doi: 10.1002/smj.184.

Lumpkin, G. T., and G. G. Dess. 1996. "Clarifying the Entrepreneurial Orientation Construct and Linking It To Performance." Academy of Management Review 21 (1):135-172. doi: 10.5465/amr.1996.9602161568.

Martin, S. L., and R. R. G. Javalgi. 2016. "Entrepreneurial orientation, marketing capabilities and performance: the moderating role of competitive intensity on Latin American International new ventures." Journal of Business Research 69 (6):2040-2051.

Naudé, W., and S. Rossouw. 2010. "Early international entrepreneurship in China: Extent and determinants." Journal of International Entrepreneurship 8 (1):87-111.

Nummela, N., S. Saarenketo, and K. Puumalainen. 2004. "A global mindset—a prerequisite for successful internationalization?" Canadian Journal of Administrative Sciences/Revue Canadienne des Sciences de l'Administration 21 (1):51-64.

Oviatt, B. M., and P. P. McDougall. 2005. "Defining international entrepreneurship and modeling the speed of internationalization." Entrepreneurship Theory and Practice 29 (5):537-554.

Parida, V., O. Pesämaa, J. Wincent, and M. Westerberg. 2017. "Network capability, innovativeness, and performance: a multidimensional extension for entrepreneurship." Entrepreneurship & Regional Development 29 (1-2):94-115.

Paul, H. 2000. "Creating a global mindset." Thunderbird International Business Review 42 (2):187-200.

Peng, M. W. 2001. "The resource-based view and international business." Journal of Management 27 (6):803-829.

Priem, R. L., and J. E. Butler. 2001. "Is the resource-based “view” a useful perspective for strategic management research?" Academy of Management Review 26 (1):22-40.

Randerson, K. 2016. "Entrepreneurial Orientation: do we actually know as much as we think we do?" Entrepreneurship & Regional Development 28 (7-8):580-600. doi: 10.1080/08985626.2016.1221230.

Rangone, A. 1999. "A resource-based approach to strategy analysis in small-medium sized enterprises." Small Business Economics 12 (3):233-248.

Ribau, C. P., A. C. Moreira, and M. Raposo. 2016. "SME internationalization research: Mapping the state of the art." Canadian Journal of Administrative Sciences/Revue Canadienne des Sciences de l'Administration.

Rogers, E. M., and D. Blonski. 2010. "The global leadership mindset." Chief Learning Officer, June:18-21.

Ruzzier, M., B. Antoncic, and R. D. Hisrich. 2007. "The internationalization of SMEs: developing and testing a multi-dimensional measure on Slovenian firms." Entrepreneurship & Regional Development 19 (2):161-183.

45

Ruzzier, M., R. D. Hisrich, and B. Antoncic. 2006. "SME internationalization research: past, present, and future." Journal of Small Business and Enterprise Development 13 (4):476-497.

Shane, S., and S. Venkataraman. 2000. "The promise of entrepreneurship as a field of research." Academy of Management Review 25 (1):217-226.

Simonin, B. L. 1997. "The importance of collaborative know-how: An empirical test of the learning organization." Academy of management Journal 40 (5):1150-1174.

Soriano, D. R., and S. R. Dobon. 2009. "Linking globalization of entrepreneurship in small organizations." Small Business Economics 32 (3):233-239.

Su, J., Q. Zhai, and H. Landström. 2015. "Entrepreneurship research in China: internationalization or contextualization?" Entrepreneurship & Regional Development 27 (1-2):50-79.

Swoboda, B., and E. Olejnik. 2016. "Linking processes and dynamic capabilities of international SMEs: the mediating effect of international entrepreneurial orientation." Journal of Small Business Management 54 (1):139-161.

Tang, Y. K. 2011. "Influence of networking on the internationalization of SMEs: Evidence from internationalized Chinese firms." International Small Business Journal 29 (4):374-398.

Tang, Z., and C. Hull. 2012. "An investigation of entrepreneurial orientation, perceived environmental hostility, and strategy application among Chinese SMEs." Journal of Small Business Management 50 (1):132-158.

Terjesen, S., J. Hessels, and D. Li. 2016. "Comparative International Entrepreneurship A Review and Research Agenda." Journal of Management 42 (1):299-344.

Wang, J., and M. Z. Ngoasong. 2012. "The internationalization process of Chinese SMEs: does globalizing wholesale markets play a role?" Strategic Change 21 (3‐4):143-157.

Wang, Y.-K. M., C. C. Chung, and D. S. Lim. 2015. "The drivers of international corporate entrepreneurship: CEO incentive and CEO monitoring mechanisms." Journal of World Business 50 (4):742-753.

Weaver, K. M., P. H. Dickson, B. Gibson, and A. Turner. 2002. "Being uncertain: the relationship between entrepreneurial orientation and environmental uncertainty." Journal of Enterprising Culture 10 (02):87-105.

Weerawardena, J., G. S. Mort, P. W. Liesch, and G. Knight. 2007. "Conceptualizing accelerated internationalization in the born global firm: A dynamic capabilities perspective." Journal of World Business 42 (3):294-306.

Westhead, P., M. Wright, and D. Ucbasaran. 2001. "The internationalization of new and small firms: A resource-based view." Journal of Business Venturing 16 (4):333-358.

46

Wiklund, J., and D. Shepherd. 2003. "Knowledge-based resources, entrepreneurial orientation, and the performance of small and medium-sized businesses." Strategic Management Journal 24 (13):1307-1314. doi: 10.1002/smj.360.

Wright, M., P. Westhead, and D. Ucbasaran. 2007. "Internationalization of small and medium-sized enterprises (SMEs) and international entrepreneurship: A critique and policy implications." Regional Studies 41 (7):1013-1030.

Wu, J., N. Pangarkar, and Z. Wu. 2016. "The moderating effect of technology and marketing know-how in the regional-global diversification link: Evidence from emerging market multinationals." International Business Review 25 (6):1273-1284.

Yang, J. Y., and J. Li. 2008. "The development of entrepreneurship in China." Asia Pacific Journal of Management 25 (2):335-359.

Zahra, S. A., and D. M. Garvis. 2000a. "International corporate entrepreneurship and firm performance: The moderating effect of international environmental hostility." Journal of Business Venturing 15 (5):469-492.

Zahra, S. A., and D. M. Garvis. 2000b. "International corporate entrepreneurship and firm performance: The moderating effect of international environmental hostility." Journal of Business Venturing 15 (5–6):469-492. doi: http://dx.doi.org/10.1016/S0883-9026(99)00036-1.

Zhang, L., and W. Xia. 2014. "Integrating small and medium-size enterprises into global trade flows: the case of China." In Connecting to global markets. Challenges and opportunities: case studies presented by WTO chair-holders, edited by M. Jansen, M. Jallab and M. Smeets, 41-53. Geneva, Switzerland: World Trade Organization Publications.

Zhang, X., X. Ma, and Y. Wang. 2012. "Entrepreneurial orientation, social capital, and the internationalization of SMEs: Evidence from China." Thunderbird International Business Review 54 (2):195-210.

Zhang, X., X. Ma, Y. Wang, X. Li, and D. Huo. 2016. "What drives the internationalization of Chinese SMEs? The joint effects of international entrepreneurship characteristics, network ties, and firm ownership." International Business Review 25 (2):522-534.

47